Q: My property is in a Deed of Trust. Can I fund a living trust with the property?
I granted the property to a 3rd party trustee on behalf of the lender.
A: There is a difference between a Deed of Trust and a Trust Deed. A Deed of Trust is a mortgage. You must have taken out a loan on the property. People can put into a Trust (as opposed to a Will) properties with mortgages. If it were otherwise, the overwhelming majority of real estate wouldn’t be eligible to be placed in a Trust. The type of deed you will use to put the property into a Trust is called a Trust Deed. I know the two terms Deed of Trust and Trust Deed are confusing, but hopefully this clears it up for you!
A: If you have a property that is already subject to a Deed of Trust, it's important to remember the language and provisions of the Deed of Trust, as well as any agreements with the lender, will play a role in this decision. Seeking legal guidance will ensure compliance with applicable laws and contractual obligations, and an attorney can guide you through the necessary steps for a proper and legally valid transfer.
A: The answer depends on the type of property. If this is your home in which you now live and will continue to live, then you may transfer the property to your revocable living trust, and you do not have to obtain the lender's consent to do so. If this is any other type of property you most likely will need the lender's consent to transfer the property to your trust. A definitive answer cannot be provided without reviewing both your trust declaration and your loan documents.
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